                                 CODE OF VIRGINIA

SEPARATION OF REGULATED AND UNREGULATED BUSINESSES (§ 56-231.50:1)

A. No cooperative that engages in a regulated utility service shall conduct any
unregulated business activity, other than traditional cooperative activities,
except in or through one or more affiliates of such cooperative. No such
affiliates, formed to engage in any business that is not a regulated utility
service, shall engage in regulated utility services.

B. The Commission shall promulgate rules and regulations to promote effective
and fair competition between (i) affiliates of cooperatives that are engaged in
business activities which are not regulated utility services and (ii) other
persons engaged in the same or similar businesses. The rules and regulations
shall be effective by July 1, 2000, and shall include provisions:

   1. Prohibiting cost-shifting or cross-subsidies between a cooperative and its
   affiliates;

   2. Prohibiting anticompetitive behavior or self-dealing between a cooperative
   and its affiliates;

   3. Prohibiting a cooperative from engaging in discriminatory behavior towards
   nonaffiliated entities; and

   4. Establishing codes of conduct detailing permissible relations between a
   cooperative and its affiliates. In establishing such codes, the Commission
   shall consider, among other things, whether and, if so, under what
   circumstances and conditions (i) a cooperative may provide its affiliates with
   customer lists or other customer information, sales leads, procurement advice,
   joint promotions, and access to billing or mailing systems unless such
   information or services are made available to third parties under the same
   terms and conditions, (ii) the cooperative&#8217;s name, logos or trademarks
   may be used in promotional, advertising or sales activities conducted by its
   affiliates, and (iii) the cooperative&#8217;s vehicles, equipment, office
   space and employees may be used by its affiliates.

C. Nothing in this article shall be deemed to abrogate or modify the
Commission&#8217;s authority under Chapter 4 (&#xA7; 56-76 et seq.) of this
title.

HISTORY: 1999, c. 874; 2000, cc. 944, 999.